FAQ: How are Rounding Rules Applied?

Q: How are rounding rules applied in Charlie? 

A:  Charlie applies standardized rounding rules across various calculations to ensure consistency and compliance with industry guidelines. The specific rounding methodology (e.g., round up, down, or nearest) varies depending on the type of calculation or data field.

Assumptions:

• Standard Rounding (SR) = > 5 rounds up, < 5 rounds down
• All Assets = 2 decimal places

Charlie Rounding Rules Matrix

Fields Rounded to Two (2) Decimal Places

These fields are rounded to two decimal places using standard rounding:

Assets and Amounts

• Amount Financed

• Large Deposit Amount

• Qualifying Payment (PITIA)

• Subordinate Financing

• Verified Assets / Verified Funds to Close

• Verified Reserves

• Minimum Required Investment (MRI) Amount

• Total Paid at Close

• Down Payment Amount / Percent

• Mortgage Insurance Premium (FHA / USDA)

• Total APR Fees

• Total Other Monthly Payments

• Total Due From Borrower

• Total Credits

• Cash To/From Borrower

• Fees (Origination, Escrows, Prepaids, Other)

Cut Off (Truncate) at 2nd Decimal Place:

• Funding Fee (VA)

• Interim Interest*

• Upfront Mortgage Insurance Premium (FHA)

• Per Diem Interest*

*Per diem and interim interest amounts may vary slightly due to vendor calculation methods or federal disclosure guidelines. Charlie currently truncates per diem values at the second decimal place for compliance.

Fields Rounded to Three (3) Decimal Places

These fields use three decimal places for precision, rounded or truncated as noted:

Rounded to 3 Decimals (SR):

• APR Percent

• Total Interest / Total Interest Percentage

• Fully Indexed Rate

• Debt-to-Income (DTI) and Housing-to-Income (HTI) Ratios

• Qualifying Rate Percent (%)

• Interest Party Contributions (IPC) Amounts & Percents

Round Down to 3 Decimals:

• Loan-to-Value (LTV)

• Combined Loan-to-Value (CLTV)

• Home Equity Combined Loan-to-Value (HCLTV)

No Rounding (Whole Numbers)

These values are stored and displayed as whole numbers:

• 1st Payment Date

• Closing Date

• Employment Gap Days Count / Threshold

• Appraised Value

• Total Loan Amount

• Total Verified Income

• Earliest Close Date

• Interim Interest Number of Days

Government Loan Rounding

FHA Annual MIP Calculation

1. Average UPB × (FHA Annual Premium %)

   • 106,160.654 × 0.005 = 530.803 → 530.80

2. If UFMIP Financed Indicator = True:

   • 530.80 ÷ (1 + 0.0225) = 519.1198 → 519.12

3. Divide by 12 for monthly MIP:

   • 519.12 ÷ 12 = 43.26 → 43.26

VA Funding Fee

• If calculated fee = 3649.6253 → 3649.62 (cut off after hundredths place)

USDA Initial and Annual Fees

• Rounded to 2 decimal places (standard rounding)